Mumbai: Indian shares shrugged off weak Asian markets and nudged higher on Wednesday, propelled by export-led outsourcers after better-than-expected results and guidance from rival Cognizant Technology Solutions Corp.
An improvement in monsoon rainfall, which is crucial for boosting rural income and demand for a wide range of goods in India, also bolstered sentiment.
By 9:50am, the 30-share BSE index was trading up 0.15% at 18,141.18, with one-third of its components gaining.
Top outsourcer Tata Consultancy Services rose as much as 3.9% to an all-time high of 866 rupees, while rivals Infosys and Wipro firmed 2.4% and 1.8% respectively.
Cognizant on Tuesday reported a profit that topped market estimates for the sixth straight quarter, helped by a surge in discretionary projects, and raised its 2010 revenue outlook well above what Wall Street was looking for.
“Cognizant results and monsoon are the key factors today,” said Mehul Dedhia, assistant vice-president of sales at brokerage Sharekhan.
Rainfall was a third higher than average on Tuesday and total precipitation since June 1 was only 2% below average, as heavy showers in the past two weeks narrowed the monsoon deficit that stood at 16% on 19 July, data from the weather office showed.
Foreign funds have invested a net of $10.7 billion in Indian stocks so far this year, driving the BSE index 3.9% higher. In 2009, they had pumped in a record $17.5 billion and fuelled an 81% rally in the benchmark.
Energy giant Reliance Industries, which has the highest weight on the Sensex, dropped 0.6%, after rising 1.6% over two previous sessions.
Financials edged lower after a recent rally. The sector index was down 0.3% after gaining 3.4% in the first two days this week.
Top lender State Bank of India was down 0.4%. HDFC Bank and mortgage lender Housing Development Finance Corp shed 0.2% and 1.2% respectively. ICICI Bank bucked the trend and edged 0.2% higher.
In the broader market, gainers led losers in a ratio of 1.4:1 on volume of 66 million shares.
The 50-share NSE index was up 0.1% at 5,443.45.
Elsewhere, the MSCI’s measure of Asian markets other than Japan was down 0.4%, while Japan’s Nikkei dropped 2.2%.
Larsen & Toubro rose 1.3% to Rs1,808.70 as the top engineering and construction firm said it had got orders worth 10.25 billion rupees for projects in the western city of Mumbai and a cement plant.
Maruti Suzuki was up 0.2% at Rs1,215 rupees, ahead of the top car maker’s news conference in New Delhi to be addressed by Managing Director Shinzo Nakanishi on the launch of a new version of its Alto car.
Steel strappings maker Midfield Industries listed at Rs154.90, a premium of 16% to its issue price of Rs133 a share. The stock extended gains and was trading at Rs172.50.